Municipal taxes would increase by 19 percent for South River residents, according to an amended 2008 budget that is now proposed.
With the state approving amendments to the $30 million tab in August, officials were able to reduce what had been a 22 percent tax rate hike when the budget was introduced in March, trimming it to 19 percent.
“The amendments made decreased the tax point by 5 points … each tax point is valued at $42,662.85,” said Andrew Salerno, borough business administrator.
If the budget is adopted, borough residents with a home assessed at $100,000 would see roughly a $344 tax increase. The municipal tax rate would rise 31.9 cents, from $1.626 to $1.945 per $100 of assessed valuation.
Municipal taxes are just one portion of a homeowner’s property tax bill, which also includes school, county and open space taxes.
Salerno said the borough was able to secure $200,000 in extraordinary aid from the state, receive $45,000 worth of grants, and put in the allocation of $75,000 into the budget due to the demolition of the building on 6 Reid St. in late March. The building had blown down after a windstorm swept through in February.
“Those were the big changes,” Salerno said.
The borough’s three major budgetary components — the water utility, the electric utility, and the current operating fund — have a total budget of roughly $30 million. The borough operates its own electric utility as part of a co-op Public Power Association, which involves seven to eight other towns including Lavallette, Milltown, and Seaside Heights. The borough also has an agreement with Old Bridge for building and code enforcement services.
Salerno had said that revenues did not meet anticipated levels this year, due in part to approximately $689,000 that previously came from surplus generation in the electric utility.
Mayor Raymond Eppinger, in his first year at the helm, said the tax rate has not gone up because of growth and spending, because the town has not added any new services.
“Our greatest loss is in revenue … . We had to replace too many one-shot deals that are not recurring revenue items,” Eppinger said.
For example, the borough is receiving $250,000 less this year in host community benefits from the Edgeboro Landfill in East Brunswick. The town had been receiving the benefits since the mid-1990s.
“The reason is less garbage is sent to the dump,” Eppinger said. “Council President John Krenzel always mentions that it is great that people are recycling, but that means less benefits that we would receive from the host community benefits.”
Borough officials are requesting that the state-imposed 4 percent budget limitation be waived in order for the borough to raise roughly $435,000 in additional tax monies.
“It is a lot of money, but a necessary spending plan for the administration’s operation,” said Jerry Stankiewicz, the borough’s auditor.
Eppinger said that if the state does not grant the tax levy waiver, it could have serious consequences for the town.
“We would have to literally have to close the borough down,” he said, adding it would be a “catastrophe” for the borough. “We would have to shut down services, just leave emergency and personnel services.”
Borough officials will go before the state’s Local Finance Board on Oct. 8, and depending on the outcome of that meeting, officials hope to adopt the budget at its next meeting, which will be held at 7 p.m. Oct. 14 at the borough chambers, 61 Main St.